Froneri scoops up US Nestlé ice cream business for $4bn

Forming a part of a strategic plan to expand into North America and grow its global footprint, ice cream...

Forming a part of a strategic plan to expand into North America and grow its global footprint, ice cream manufacturer Froneri has acquired Nestlé USA ice cream business for a value of $4 billion.

Mayer Brown took an advisory role to Nestlé on the US business sale, which was originally formed as a joint venture with private equity company PAI Partners, in 2016.

The acquisition follows Froneri’s acquisition of Nestlé’s Israeli ice cream business, Noga Ice Creams Limited Partnership, part of the Nestlé-owned business Osem Group, announced by Froneri on 4 July. This brought Nestlé’s Europe, Middle East & North Africa ice cream businesses under the Froneri group.

The Nestlé USA acquisition agreement will see Froneri acquire Nestlé USA’s management team and marketing, manufacturing and sales and distribution capabilities, as well as super premium ice cream brands including Dreyer’s, Häagen-Daaz, Outshine, Skinny Cow, Edy’s and Drumstick.

Following the acquisition, Nestlé, the multi-national food and drink processing conglomerate, will continue to manage its remaining ice cream businesses in Canada, Latin America and Asia, as part of its current market structure.

“The continued support of PAI Partners will be essential” to providing value for Froneri consumers, said Froneri’s CEO, Ibrahim Najafi, in a statement.

Frédéric Stévenin, partner at PAI Partners, added this this is “a great opportunity for further growth”, while Najafi added that “the acquisition is testament to the strength and longevity of our relationship with Nestlé”.

Earlier this year, Froneri also acquired New Zealand ice cream business Tip Top, announced by Froneri on 13 May, a move which allowed it to unlock business in the New Zealand and Pacific region.

The Mayer Brown team advising Nestlé on the acquisition included New York-based corporate and securities partners David Carpenter and John Boelter as well as Northern California-based Michelle Gross.

Chicago-based intellectual property partner Rich Assmus and real estate partner based in Charlotte David Saye were also involved.

It is anticipated that the transaction will close in the first quarter of 2020, subject to meeting customary regulatory approvals.

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